The Department of Banking News Bulletin
Bulletin # 2397
Week Ending January 29, 2010
This bulletin constitutes the only official notification you will receive from this office concerning any of the following applications. Any observations you may have are solicited. Any comments should be in writing to Howard F. Pitkin, Banking Commissioner, at the Connecticut Department of Banking, 260 Constitution Plaza, Hartford, CT 06103-1800 or via E-mail. Written comments will be considered only if they are received within ten days from the date of this bulletin.
On January 25, 2010, pursuant to Section 36a-184 of the Connecticut General Statutes, Union Savings Bank, a Connecticut-chartered mutual savings bank, filed an acquisition statement to acquire First Litchfield Financial Corporation, a Delaware corporation, and indirectly The First National Bank of Litchfield, a national bank and wholly-owned subsidiary of First Litchfield Financial Corporation. The filing was made in connection with an application for the merger of The First National Bank of Litchfield with and into Union Savings Bank that was filed on December 23, 2009, pursuant to Sections 36a-125 and 36a-126 of the Connecticut General Statutes.
On January 25, 2010, pursuant to Section 36a-70(k)(1)(A)(i) of the Connecticut General Statutes, First Community Bank of New Haven (In Organization), a de novo bank in organization to be headquartered in New Haven, Connecticut, filed an application with the Commissioner to change its name to Start Community Bank. Written objections to such application may be made, for a period of 30 days from the date of publication of this bulletin, on the grounds that the name selected will tend to confuse the public.
NEW BANK APPLICATION AMENDED
The application to organize Sachem Bank, Madison, Connecticut, pursuant to Section 36a-70 of the Connecticut General Statutes, has been amended to add Gerald “Jerry” A. Davis as an organizer of Sachem Bank (In Organization). Additional organizers were previously identified in Bulletin #2356, dated April 21, 2009, Bulletin #2358, dated May 5, 2009, and Bulletin #2391, dated December 22, 2009.
SECURITIES AND BUSINESS INVESTMENTS DIVISION ACTIVITY
Order Imposing Fine and Order to Cease and Desist Made Permanent
On January 22, 2010, the Banking Commissioner entered an Order to Cease and Desist and Order Imposing Fine against Derek M. Lofton, currently of 1174 Paramount Drive, McDonough, Georgia. The action had been preceded by a June 30, 2009 Order to Cease and Desist, Notice of Intent to Fine and Notice of Right to Hearing alleging that: 1) in 2007, Respondent Lofton, together with co-respondents Commonwealth Exploration Corporation and Carlos E. Conde, sold unregistered interests in Perimeter Summit, LLP, a Kentucky oil and gas concern, in violation of Section 36b-16 of the Connecticut Uniform Securities Act; and 2) the respondents violated the antifraud provisions in Section 36b-4 of the Act by disseminating offering documents that failed to disclose financial information about the performance of prior interests in oil and gas rights in which Commonwealth Exploration Corporation was the manager; investment risk factors; that Respondent Lofton was not registered to sell securities in Connecticut; that the Perimeter Summit, LLP interests were not registered in Connecticut; and that Lofton was subject to a prior Connecticut administrative action alleging that he sold unregistered securities in an unregistered capacity. The June 30, 2009 action had also alleged that, in violation of Section 36b-6 of the Act, Respondent Lofton unlawfully transacted securities business as an unregistered agent of issuer.
Although Respondent Lofton requested a hearing on the June 30, 2009 Order to Cease and Desist and Notice of Intent to Fine, he failed to appear at the hearing that was held on October 1, 2009. Under Section 36a-1-31(b) of the Regulations of Connecticut State Agencies, a party’s failure to appear at a scheduled hearing may result in the allegations against that party being admitted. On January 22, 2010, the Commissioner issued Findings of Fact and Conclusions of Law adopting the matters asserted in the June 30, 2009 Order to Cease and Desist and Notice of Intent to Fine. The Commissioner fined Respondent Lofton $100,000 and concluded that Respondent Lofton had committed three violations of Section 36b-16 of the Act, three violations of Section 36b-4(a) of the Act and three violations of Section 36b-6(a) of the Act. The Commissioner also rendered the June 30, 2009 Order to Cease and Desist permanent.
CONSUMER CREDIT DIVISION ACTIVITY
Temporary Order to Cease and Desist, Notice of Intent to Revoke
Money Transmission License, Notice of Intent to Issue
Order to Cease and Desist, Notice of Intent to Impose Civil Penalty
On January 15, 2010, the Commissioner issued a Temporary Order to Cease and Desist, Notice of Intent to Revoke Money Transmission License, Notice of Intent to Issue Order to Cease and Desist, Notice of Intent to Impose Civil Penalty and Notice of Right to Hearing (“Notice”) in the Matter of: Envios R.D. Corp. d/b/a Pronto Envios
(“Respondent”). The Notice alleged that Respondent engaged in an unsafe and unsound practice, within the meaning of Section 36a-596(16) of the Connecticut General Statutes, as amended by Public Act 09-209, by failing to transmit money or monetary value received from purchasers or to return such money or monetary value to purchasers; knowingly made an incorrect statement of a material fact in an application; and failed to promptly notify the Commissioner of administrative actions in other states in violation of Section 36a-598(b) of the Connecticut General Statutes, as amended by Public Act 09-208. The Commissioner also found that public welfare required the issuance of a Temporary Order to Cease and Desist. Respondent was afforded an opportunity to request a hearing with regard to the allegations set forth in the Notice. A copy of the Notice can be obtained from the Department’s website
Order Refusing to Renew Mortgage Loan Originator License
On January 22, 2010, the Commissioner issued an Order Refusing to Renew Mortgage Loan Originator License (‘Order”) in the Matter of: Karen Lisa Cabral a/k/a Karen Cabral-Allen
(“Respondent”). The Order refuses to renew Respondent’s mortgage loan originator license, and such license is deemed expired. The Order was based on Respondent’s plea of nolo contendere to a felony which has not been pardoned, the making of a false or misleading statement in violation of Section 36a-53a of the Connecticut General Statutes, and failure to demonstrate that Respondent has the character and general fitness so as to command the confidence of the community and to warrant a determination that Respondent will operate honestly, fairly and efficiently within the purpose of Sections 36a 485 to 36a-498c, inclusive, as amended, Sections 36a-534a and 534b, as amended, and Sections 9 and 19 to 21, inclusive, of Public Act 09-209. A copy of the Order can be obtained from the Department’s website
Dated: Tuesday, February 2, 2010
Howard F. Pitkin